Hong Kong regulator partially clears PwC of malpractice claim in Evergrande’s fraud case
- Review of PwC’s internal investigation shows there is no evidence to support some of the allegations made by anonymous whistle-blowers, AFRC says
Hong Kong’s accounting regulator said there was no evidence to support allegations made by whistle-blowers against PwC, which has been caught in a slew of scandals tied to the now-liquidated China Evergrande Group.
The Accounting and Financial Reporting Council (AFRC) said in a statement on Wednesday that after examining the internal investigation carried out by PwC, it has determined that the evidence does not support three of the allegations concerning the auditing firm’s quality controls.
The AFRC said it found no evidence for the allegations that PwC had failed to establish and maintain effective quality controls, failed to adhere to professional standards regarding its client relationship with Evergrande, and failed to assign appropriate personnel to key positions.
The allegations were made in an anonymous whistle-blower letter that circulated on social media in April. PwC refuted the accusations in the letter.
However, the regulator noted that a separate investigation into the quality of PwC’s audit work related to Evergrande is still under way.
